Many people think of mobile advertising as a subset of Internet advertising. But it’s actually more far-reaching than Internet advertising.
Mobile advertising is a form of advertising, but is somewhat separated from Internet advertising. Mobile advertising has its own set of rules that differ from Internet advertising. With Internet advertising, you have the whole computer screen to work with, which means you’ve got cool graphics that can tell your story. Many people have cell phones and BlackBerrys that can get the Internet, but mobile advertising doesn’t only target these people. Mobile advertising also reaches those cell phone users who don’t have the Internet on their phones. SMS (short message service) is a communication protocol that cell phones users use – it’s most often referred to as text messaging. Not all text messaging services use SMS, but SMS has become synonymous with text messaging so that’s generally what people are talking about when they say SMS.
Mobile advertising is growing at rapid rates in Asia, Europe and the United States, but is also slowly growing in other countries as the technology gets cheaper. Mobile advertising is growing because of the ability to catch people when they’re not at home in front of their TVs or computers.
According to Informa Telecoms & Media, a research firm, just under $900 million was spent worldwide on mobile advertising. Doesn’t sound too shabby until you compare it with spending on Internet advertising: $24 billion. Total worldwide ad dollars spent in 2007 topped out at $450 billion. That makes Internet advertising look small as well. They’re small now, but both mobile and Internet advertising are growing.
Currently, mobile ads mainly comprise text messages, but in the near future could most likely include video clips, mobile-only Web pages, music downloads and game downloads (Economist.com).
However, with the current economy in the slumps, The Financial Times has reported that mobile advertising will be affected for two years, after which marketing agencies will expect companies to increase their ad budgets. All forms of advertising will be affected be the economy, but Jean-Paul Edwards, executive director of futures at Manning Gottlieb OMD, which is part of Omnicom, a marketing agency, said “advertisers become more conservative in downturns, and retreat into what is most proven….The current economic climate will push things back a bit. If money is tight, mobile is not proven yet.”
Revenues from mobile advertising will still grow, just not at the rate that some would like. Google, Yahoo!, Nokia and Microsoft won’t be thrilled with the downturn, but they won’t be totally disappointed: Research firm Informa forecasts that revenues from mobile ads will rise to $12 billion by 2013. So far in 2008, only $1.2 billion has been spent on mobile ads.
As with any wave, mobile will have its rises and falls, so it’s best to get in when the wave is low so you can ride high with it when the tides turn in a few years.
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